You are a member of Congress in 2007–2009 when the economy is in a recessionary gap. If your goal is to achieve full employment, you should vote for
A. decreased government purchases, increased taxes, and a cut in transfer payments.
B. a balanced federal budget.
C. increased government purchases, decreased taxes, and an increase in transfer payments.
D. increased government purchases and transfer payments, and an equal increase in taxes.
Answer: C
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When the government chooses to spend the tax dollars that it collects on homeland security, its choice
A) involves a tradeoff of other goods and services such as education for more homeland security. B) illustrates that scarcity does not always exist. C) involves no tradeoff because the defense is necessary. D) primarily affects who gets the goods and services produced.
The framers of the Constitution sought to limit the economic role of the government as evidenced by
A) all of the above. B) the enumeration of the permissible powers of the federal government in Article I, Section 8. C) the 5th Amendment's limitation on the government's power to take private property. D) the 10th Amendment's allocation of all non-enumerated powers to the states and the people.
Because the Soviet Union educated more scientists and engineers than the United States, their level of economic growth was higher.
Answer the following statement true (T) or false (F)
Exhibit 11-2 Aggregate demand and supply model
Suppose the economy in Exhibit 11-2 is in equilibrium at point E1 and the marginal propensity to consume (MPC) is 0.75. Following Keynesian economics, the federal government can move the economy to full employment at point E2 by:
A. decreasing government tax revenue by approximately $33 billion. B. decreasing government tax revenue by $750 billion. C. increasing government tax revenue by $100 billion. D. increasing government tax revenue by approximately $33 billion.